Room for commercial ties to grow

ENCOURAGING young Slovaks to study in Australia seems to David Stuart a great way for Australians and Slovaks to learn more about each other and their countries, and he notes that 634 student visas were issued to Slovak nationals during 2011 and 2012. Australia’s ambassador-designate to Slovakia also explains that a bilateral work-and-holiday visa arrangement would make it possible for young people who have finished, or are undertaking, a university degree to combine tourism with limited periods working in each other’s countries. Stuart believes that such an agreement would result in an increase in the numbers visiting in each direction.

ENCOURAGING young Slovaks to study in Australia seems to David Stuart a great way for Australians and Slovaks to learn more about each other and their countries, and he notes that 634 student visas were issued to Slovak nationals during 2011 and 2012. Australia’s ambassador-designate to Slovakia also explains that a bilateral work-and-holiday visa arrangement would make it possible for young people who have finished, or are undertaking, a university degree to combine tourism with limited periods working in each other’s countries. Stuart believes that such an agreement would result in an increase in the numbers visiting in each direction.

The Slovak Spectator spoke to Ambassador-designate Stuart about Australia’s economic performance, the potential for contacts with central Europe, and migration policy, as well as the challenges of climate change.

The Slovak Spectator (TSS): Australia has survived the global financial crisis without suffering a recession and boasts almost two decades of continuous economic growth. What helped the economy of your country to emerge from the global crisis without more serious ill-effects?David Stuart (DS): Australia has been able to maintain economic growth with good employment and inflation numbers despite the problems in the global economy. The official forecast for growth released by the Australian Treasury in December 2012 was for an annual level of GDP growth of 3 percent, underpinned by growth in new investment, non-rural commodity exports and household consumption. Our unemployment rate is a little over 5 percent and inflation is expected to remain in the range of 2-3 percent through the next 18 months.

In part, Australia’s economic performance and our positive outlook reflect our strong energy and minerals endowment, which has greatly boosted our commodities trade with China in particular, although other commercial relationships are also developing quickly, for example with India. It is encouraging that our overall exports of manufactures and services have also continued to do well.

Education is consistently Australia’s third or fourth biggest export item; foreign students represent almost a third of all students in our universities.

Australia is, of course, not alone in having a strong resources endowment. It is widely acknowledged that a series of economic reforms, especially since the mid-1980s, and sound economic management have helped us to avoid the worst of the fallout from the global financial crisis. Our fiscal position is strong by international standards; Australia’s net debt is about 10 percent of GDP.

TSS: Australia’s economy was judged to be the world’s third freest in a 2013 ranking based on an analysis by the Heritage Foundation. By contrast, Slovakia was in 42nd position. To what factors do you attribute this high level of economic freedom?DS: Australia has stable political and economic institutions, underpinning an environment with a high degree of certainty and confidence for business and investors. We have a multicultural population and a highly skilled workforce; our education system is good, although governments are aware that we need to go on strengthening it to continue to be globally competitive. We have an open, market-based economy in which the private sector and the federal and state governments share the goal of promoting international competitiveness and higher productivity.

While I do not know what arguments were used in the Heritage Foundation’s study, it is probably material [showing] that Australia has, compared to almost all OECD countries, a relatively low incidence of government revenue as a proportion of GDP.

TSS: Australia’s economic policies reflect a growing orientation towards Asia. What is the position of the European Union on the map of Australia’s trading partners? Is the Visegrad Four region interesting for Australia and if so, in what respect?DS: In October 2012, Prime Minister [Julia] Gillard released a white paper, “Australia in the Asian Century”. The white paper is a both a comprehensive analysis and a blueprint for developing our policy response to the rapid emergence of Asia. The paper concludes: “The Asian century is an Australian opportunity. As the global centre of activity shifts to our region, the tyranny of distance is being replaced by the prospects of proximity. As the century unfolds, the growth in our region will impact on almost all of our economy and society.”

Australia’s four largest trading partners, based on 2011 figures, are already China, Japan, the USA and South Korea. Two-way trade in goods and services with China in 2011 was about AUD120 billion, close to €100 billion at the current exchange rate, with Japan around AUD70 billion and with the Republic of Korea about AUD33 billion.

While Australia is focused on taking advantage of changes in the global economy, we continue to value and seek to expand our economic ties with Europe. The EU countries represent around 13-14 percent of our total trade but are rather more significant as a source and destination for investment – around one third of the total foreign investment in Australia has come from EU countries.

There is interest in the economic opportunities offered by the economies of central Europe, and in the Visegrad arrangement. Australia is already a market for a range of manufactured goods from Slovakia, most notably cars such as the Audi Q7 and the VW Touareg. Total imports from Slovakia to Australia for the 12 months to June 2012 were AUD193 million, of which passenger motor vehicles constituted AUD139 million.

TSS: You took on your position as Australia’s ambassador to Austria, with non-resident accreditation to Bosnia and Herzegovina, Kosovo, Slovakia, Slovenia and Ukraine, in September 2012. What interest does Slovakia hold for you personally?DS: The potential for a growing economic relationship with one of the more dynamic economies in central Europe is interesting. I am also interested in developing a dialogue with the government to learn more about Slovak perspectives on international issues, in particular those which Australia will have to address as a member of the UN Security Council for the next two years, such as the Western Balkans.

Australia and the Slovak Republic work well together on a range of international issues; a good example is our cooperation in Uruzgan province in Afghanistan, where your troops and ours have worked alongside each other very effectively. There is much to see and do in Slovakia. On a personal note, my wife and I are looking forward to our first summer here and the opportunity to do some hiking in the High Tatras.

TSS: Australia has been an attractive destination for Slovak immigrants. Have the immigration policies of Australia changed over the past couple of years? What are the current immigration trends in your homeland?DS: Australia has an active, managed programme of migration. In 2010-11, more than 180,000 people came to Australia under this programme. Reflecting our modern history as a country of migration, nearly half of all Australians were either born overseas, or have a parent who was born overseas. And as a part of this, Australia has benefited from the contribution of Slovak immigrants.

Australia’s migration programme has a strong emphasis on attracting people with the skills and capabilities to fill current and emerging skills shortages. It also recognises the social benefits of reuniting Australians with their families. In addition, around 8 per cent of total places are allocated for humanitarian reasons, for example for refugees through resettlement.

TSS: In what areas do you see room for cooperation between Slovakia and Australia; in business, culture or tourism?DS: In my own view, the potential for stronger commercial ties is the most likely area. Planning is now under way for a high-level delegation of Australian business leaders to visit Bratislava later this year.A particularly positive aspect of the relationship between our countries is the number of young Slovaks who study in Australia: 634 student visas were issued to Slovak nationals for 2011-12. This seems to me a great way for Australians and Slovaks to learn more about each other and our countries. I am, however, aware of other links, for example in the cultural field, and hope to see these develop too.

TSS: Has your embassy been involved in any shared projects with Slovakia?DS: At present, the two governments are negotiating a reciprocal work-and-holiday visa arrangement for young Slovaks and young Australians. I also anticipate more direct business contacts. The embassy does not always have the central role, especially on technical matters, but I am looking forward to playing our part and getting to know our counterparts in Bratislava well.

TSS: What, currently, are the challenges that tourism in Australia faces? Have Australians discovered the Visegrad Four region as a tourism destination?DS: Tourism is an important industry for Australia. The quite unique nature of our continent and its extraordinary diversity are an attraction to people from around the world. Australia does not keep figures for how many Australians visit Slovakia although I understand that the Slovak Tourist Board reports that 5,000 Australians visited Slovakia in 2011.

As I have mentioned already, a bilateral work-and-holiday visa arrangement would make it possible for young people who have finished, or are undertaking, a university degree to combine tourism with limited periods working in each other’s countries. Concluding such an arrangement with the Slovak Republic should see an increase in the numbers visiting in each direction; this would be good for our respective economies but would also stimulate the people-to-people contacts that add a valuable dimension to the relationships between nations.

TSS: Climate change has become an increasing concern in Australia in recent years, while protection of the environment is a major political issue. What are the most significant challenges that your homeland faces in this area and what are the most urgent steps it plans to make?DS: Australian governments have been active on climate change at home and through our engagement internationally to achieve sustainable management of our environmental resources. We regard an effective response to these challenges as increasingly important to our economic prosperity as well as to conserving Australia’s unique environment. Australia met its undertakings on limiting greenhouse gas emissions under the first commitment period of the Kyoto Protocol to the UN Framework Convention on Climate Change. The government led by Prime Minister Gillard is committed to a clean energy future, and to reducing Australia’s emissions by at least five percent compared with 2000 levels by 2020, and by 80 percent by 2050.

In 2012 the government introduced a carbon price to prepare Australian businesses and industries to compete in a low-pollution global economy. Under this policy, the cost of carbon pollution will be fixed for the first three years and thereafter it will be set by the market. Australia has agreed to link our domestic carbon market with the European Union Emissions Trading System. Australia is also working closely with our Asian neighbours, including China, Indonesia, Japan and the Republic of Korea, to build well-functioning and comprehensive carbon markets.

Australia has invested billions of dollars in cleaner energy sources, including renewable energy, to transform the energy sector by moving away from high-polluting power generation. For example, AUD1.2 billion, which is approximately €1 billion, has been invested through the Clean Technology Program to help manufacturers develop and adopt clean technologies and improve energy efficiency. Australia, under the government’s Carbon Farming Initiative, is also storing carbon in the land through better land management strategies.